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Investing In Real Estate Takes Time And Money

Todays Date: October 20, 2018

Real estate flipping has become very popular, thanks to a glut of television shows on the subject. Before you take on this project, be sure it is right for you.

When buying properties in La Manga or Los Angeles, knowledge is power. Be sure you know everything about a parcel before you buy it. How old is the building? Why is it being sold? When you tour a house, make a list of questions you have and potential problems you may see. Flush the toilets, flick on the lights, looking for water marks, cracks and sagging in the ceilings, floors and walls. Check the plumbing for leaks.

Even after you’ve checked the house yourself, hire a professional inspector to examine the house with you. Remember, real estate is an investment: You have to spend money to make money. The inspector will find potential problems you may have missed and may even provide a rough estimate as to how much it will cost to repair them and whether the price is worth it. Also consult an appraiser who can tell you a home’s value and compare it to others in your area.

Before you make an offer, make sure the property is in a great location. Are there many homes for sale in the area? Are their churches, schools and stores nearby? Is there a lot of crime? Are there any liens or special tax assessments on the property? It is best to know this information in order to help you make a wise choice.

Most of us would need to obtain loans for property investment. So it is good to consider the long-term consequences. Most mortgages are for 15 or 30 years: Would you be able to pay it off and obtain a good return on your investment? Consult an accountant who has experience in real estate matters. He or she can help you figure out if repairs you make on a home will be a good return on investment for you.

If you are interested in flipping a house, be sure you have the expertise, the time and the money to do the work. The television shows make it look relatively easy, but if you have another job or family considerations, you may discover you just don’t have the time or the skills to make sure the repairs are done correctly. If you do shoddy work, the buyer of the property could sue you, which would more than eat up any profit you made by cutting corners.

One last thing to consider: If you buy a property with the intent of flipping it, don’t fall in love with it. It is easy to get sentimental about something on which you’ve put so much time. Take photographs of the parcel before, during and after your work, and then let it go to the happy new owner. That way flipping can benefit both of you.

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